The PRD-repeat domain contains a sequence of alternating His and either Pro or Ser residues and has been found in many transcription factors such as the prd and bcd homeodomain transcription factors and the ecdyson-inducible gene product E74. The Drosophila NK-1 homeobox gene, which was shown to be expressed in specific muscle cells and a subset of neuronal cells of the ventral nerve cord and brain, also has a coding sequence for a PRD-repeat domain. The function of the PRD-repeat domain, however, is unknown. Previously, we identified four novel genes that encode proteins that interact with NK-1 protein from the screening of the Drosophila match-maker cDNA library using the yeast two-hybrid system that is a genetic-based method to detect protein-protein interaction. We further characterized those cDNA clones and found that all of the deduced amino acid sequences show a Cys-rich region. In order to investigate which region of the NK-1 protein could interact with these gene products, various NK-1 bait constructs were generated and interaction assays were performed after cotransformation into yeast. From this analysis, we found that a PRD-repeat domain functions as a protein-binding interface. Using transient expression assays, we also determined that the carboxyl-terminal region of the NK-1 protein contains a repressor domain which is very similar to that of eve homeodomain protein, suggesting that the NK-1 can act as a transcriptional repressor. Previously, we cloned a mouse NKx-1.1 homeobox gene. Now, we have cloned another NK-1 homolog, NKx-1.2 homeobox gene, from mouse. Sequence analysis of NKx-1.1 and NKx-1.2 showed a 97% identity in amino acids sequence within the homeodomain. RT-PCR analysis showed that both genes were expressed during early embryogenesis. Characterization of gene structures and expression patterns are underway. In addition, we initiated a gene knock-out study in order to identify functions of the NKx-1 homeobox genes. Constructs for homologous recombination were transfected into AB-1 embryonic stem cells and several hundred resistant clones to both neomycin and gancyclovir were collected.